China's breakneck economic development is endangering the country's environment and saddling society with a huge cleanup bill, the leading paper said Saturday.

The People's Daily reported that "if forceful policies are not implemented," the nation faces a future of denuded forests, dirty lakes, barren grasslands and smoggy skies.The report said the twin evils of pollution and misuse of natural resources have reached such a state in China that annual cleanup costs are estimated at about $23 billion.

"By the end of the century," the paper said, "if the environment continues to worsen, it will become a major factor limiting economic development."

The paper said about 1 percent of the country's $270 billion gross national product - or $2.7 billion - should be devoted each year to ecology.

But the Xinhua news agency reported that by October only $1.8 billion had been allocated for the purpose, although it said the state planned an increase of 50 percent in coming years.

Since 1978, China's gross national product has jumped 100 percent, but the economic and industrial growth has come at an enormous ecological cost - one which the government has only recently begun to realize.

A Xinhua report said that by the year 2000, nearly half of China's 2,800 lakes could be polluted. An earlier survey on 58,900 miles of rivers found that 20 percent were polluted and another 8 percent seriously contaminated.

Reports have blamed acid rain, caused by burning the high-sulfur coal that predominates in China, for killing trees in Hangzhou, a beautiful lakeside metropolis south of Shanghai.

In the countryside, increased use of chemical fertilizers has seriously affected soil quality and water resources. In addition, "timber poachers," who raid forests for firewood and building materials, have been fingered in the country's continuing problem with deforestation.

The People's Daily said Saturday's report was based on a four-year study to forecast environmental conditions in the year 2000.